Problem
1. A monopoly sells 30 units of output when price is £12 and 40 units when price is £10. If its demand schedule is linear, what is the specific form of the actual demand function? Use this function to predict quantity sold when price is £8. What domain restrictions would you put on this demand function?
2. Assume that consumption C depends on income Y according to the function C = a + bY , where a and b are parameters. If C is £60 when Y is £40 and C is £90 when Y is £80, what are the values of the parameters a and b?
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.